Legally Armed: V23N1

By Johanna Reeves, Esq.

How U.S. Foreign Policy and National Security Concerns Impact International Trade

Many companies in the firearms and ammunition industries are increasing their efforts in global trade. There are many reasons for doing this, not the least of which is the significant downturn in the U.S. market since President Trump took office. As demand in the United States has decreased, companies are looking to the international marketplace to fill the gap. In addition, the Trump Administration has rolled out new policies to spur exports of U.S. military equipment abroad, including finally moving forward with the complete overhaul of the export controls over most firearms and ammunition. These so-called “transition rules” (see my 2-part Legally Armed series in Small Arms Review, Vol. 22, No. 8 (October 2018) and Vol. 22, No. 9 (November 2018)) are expected to be finalized at the end of 2018 or in the first quarter of 2019.

Despite the many draws, however, the decision to enter into the global marketplace must take into consideration the enormous amount of government oversight and risks inherent to bureaucratic permissions. As many readers know, a fundamental principle of the U.S. import/export control laws is that appropriate government authorization must be in place prior to either exporting or importing firearms or ammunition, as well as all parts, components, accessories and attachments. That authorization can be a license, agreement or other form of authorization (e.g., license or permit exemption, retransfer approval) issued by the controlling agency of the U.S. Government. Without such authorization, the company cannot lawfully proceed with an export or an import, as the case may be.

The licensing process is cumbersome and expensive. Noteworthy is the fact that many U.S. businesses have been deterred from venturing into foreign markets because of the complexity of U.S. import and export laws governing firearms and ammunition. But for those who have decided to play in this sandbox, the challenges do not end with getting authorization from the U.S. Government. There may be limitations on the license or permit (the dreaded license “provisos”) or required notifications (example, submitting a list of serial numbers...

This article first appeared in Small Arms Review V23N1 (January 2019)
and was posted online on November 16, 2018


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